British Gas announced a 35 per cent rise in gas prices yesterday, the biggest increase imposed by a leading energy company, adding to inflationary pressures in the economy and raising fears about fuel poverty.

British Gas is the UK's largest energy supplier, selling gas to 10m households. Of these, the 5m households that buy both their gas and electricity from British Gas face a 25 per cent jump in their bills. About 1m households that only buy electricity from the company will pay 9.4 per cent more.